Skip to Content
avatar image
Former Member

Difference between Credit memo and subsequent credit

All SAP Gurus,

In MIRO, what is the difference between Credit memo and subsequent credit?

Regards,

Add comment
10|10000 characters needed characters exceeded

  • Get RSS Feed

4 Answers

  • Best Answer
    avatar image
    Former Member
    Nov 23, 2009 at 11:36 AM

    HI

    Credit Memo for eg. it can be used for vendor returns, Return delivery (via GRN) will be done and based on the PO and return delivery quantity, the credit memo will be raised and where as Subsequent credit don't need any reference, it can be any kind of adjustment to vendor payment directly.

    Regards

    Prasanna

    Add comment
    10|10000 characters needed characters exceeded

  • Nov 23, 2009 at 11:33 AM

    Difference between Credit memo and subsequent debits/credits

    Subsequent Debits/Credits are used in cases where the quantity is in the original invoice is to remain the same. For eg.

    PO 10 - $10

    Gr 10 - $10

    LIV 10 - $11 (Logistics Invoice Verification)

    The vendor invoice is more than that in the Purchase Order. In order to correct, the Vendor may send in another invoice for

    the Increased amount or a credit memo for the increased amount.

    If you approve of the price increase, post the subsequent invoice received as a Subsequent Debit/Credit Invoice.

    If it is a credit memo that has been received, then post the credit memo as Subsequent Debit/Credit.

    This would retain the quantity but reduce the amount.

    Subsequent Debit/Credit is for the case when the credit is not for the full amount eg. if the Vendor decided to credit

    only the $1 overcharged.

    Credit memo is for the credit of the full amount and value.

    Add comment
    10|10000 characters needed characters exceeded

  • avatar image
    Former Member
    Nov 23, 2009 at 11:34 AM

    Credit memo is used when you need to get some amount from vendor i.e. in case of return delivery etc.

    Subsequent credit is used for posting price change with retrospective effect i.e. suppose your PO price is Rs 1,000 /- and po date is 10-04-2009. You have received total PO qty and posted MIRo in May-2009. If u come to know in June-2009 that PO price should be Rs 950 /- effective from 10-04-2009 itself, then you will use subsequent credit

    Hope this will clarify your doubt

    Add comment
    10|10000 characters needed characters exceeded

  • avatar image
    Former Member
    Nov 23, 2009 at 11:43 AM

    Hi

    Credit memo: This functionality is used if you have performed an IV for quantity 100 and later you have relaised that you have to make it for only 90 then you hit a credit memo for remaining 10 .Note that during credit memo the Inventory accounts are not getting hit .It is only negation of IV entries

    Eg

    Vendor acc Dr

    GR/IR Clearing Cr

    Subsequent credit: This functionality is used if you have to pay less than the PO value .i.e you want to pay the vendor less from the one defined in the PO and also reduce the Inventory Value by the Inflation caused by wrong PO price during GR.eg lets assume that PO value is Rs 10 ,you have made GR with a inventory value of 10 Later you have realised that the PO value should have been Rs 9 Then in such cases you hit a Subsequent Credit where the folloeing accounting entries take place

    Vendor Acc Dr

    Inventory acc /Price difference account( based on availibilbity of stock ) Cr

    Regards

    Sandeep

    Add comment
    10|10000 characters needed characters exceeded